The United States Wednesday dismissed the nominal transfer of authority in Burma from military to civilian figures as "immaterial" and said military leaders remain in control. The State Department said the Obama administration will continue pushing for genuine reform.

The State Department is calling the nominal transfer of power to civilians in Burma at best a lateral move, and says the United States will continue pressing a two-track strategy of engagement with Burmese authorities and sanctions to try to promote real reforms.

The comments came after a ceremony in the Burmese parliament in which the long-ruling military junta was declared officially dissolved, and a new civilian government -- chosen in a widely-criticized election last November -- sworn into office.

The former prime minister in the military-led government, Thein Sein, an ex-general who gave up his military post only last year, became president of a self-described civilian government that includes other former military officials.

Asked at a news briefing if the development was an advance for Burma, State Department Acting Deputy Spokesman Mark Toner said it was a step sideways, or even backwards, for the politically-isolated Southeast Asian state. "There was a fundamentally flawed election process that’s now ensured that key military regime figures have continued to dominate the government and all decision-making. The fact that they’ve take off their uniforms and donned civilian clothes is immaterial. We remain deeply concerned about Burma’s repressive political environment," Toner said.

Spokesman Toner said the United States urges Burmese authorities to release all political prisoners, recognize the legitimacy of Aung San Suu Kyi’s National League for Democracy Party, the NLD, and to enter into a genuine, inclusive, dialogue with all democratic and ethnic-based opposition groups "as a first step toward reconciliation."

Aung San Suu Kyi’s party won Burmese elections in 1990 but the military ignored the results and kept the Nobel Peace laureate in detention for most of the last two decades.

She was freed from house arrest a few days after the November election, while the NLD was ordered disbanded for boycotting the election.

An NLD spokesman said the party is open to dialogue with the new government but remains concerned about continuing military control.

In his inaugural speech, new President Thein Sein accused Western countries of bullying Burma and said they should recognize positive changes and drop sanctions.

The Obama administration has sent senior envoys to Burma seeking dialogue, but also has kept long-standing sanctions, including a near-total trade ban, in effect.

The State Department spokesman said the administration remains committed to the two-track strategy of outreach and sanctions, but has always been "clear-eyed" about its expectations from the attempt at engagement.